OPM’s New Awards Guidance: What Federal Employees Need to Know
awards policy federal employment merit system principles opm guidance ses ratings Aug 12, 2025The Office of Personnel Management (OPM) has issued new, government-wide guidance aimed at “targeting the highest-performing” federal employees for the largest awards and bonuses. Under the memo, agencies must:
-
Strengthen performance management and “normalize” ratings.
-
Reserve at least 60% of bonus pools for employees rated above Fully Successful.
-
Use more real-time awards, such as Special Act awards, Time-Off awards, and Quality Step Increases (QSIs).
For Senior Executive Service (SES) and Senior Professional (SP) employees, OPM sets a 30% ceiling on Level 4/5 ratings in FY 2025 as an “encouragement” and makes that a hard limit in FY 2026—unless waived by the President. Compliance plans are due September 8, 2025, with a full ratings/awards report due February 27, 2026.
Where the Law Sets Boundaries
Forced Distribution Rules Still Apply
Current regulations prohibit assigning ratings through quotas or forced distributions for both general employees and SES. Ratings must be based solely on actual job performance. While OPM has proposed removing the SES ban, until a final rule is in place, agencies that “normalize” by imposing bell curves risk violating 5 C.F.R. Part 430. Award amounts can be sorted using comparative data, but the ratings themselves must remain performance-driven.
Collective Bargaining Obligations
For bargaining unit employees, any changes to performance distributions, bonus pools, or appraisal procedures must be consistent with negotiated agreements. Skipping this step can trigger unfair labor practice (ULP) complaints. Agencies must follow both the substance and process requirements of the collective bargaining framework.
Merit System Protections
The civil service is built on merit-based decisions. Awards must avoid favoritism, retaliation, or discrimination. Patterns that disadvantage protected groups can raise Title VII or Age Discrimination in Employment Act (ADEA) concerns. Agencies should ensure award criteria are clearly documented, job-related, and consistently applied.
Pay Caps and Approval Requirements
Cash awards over $10,000 require OPM approval; those over $25,000 need Presidential sign-off. The aggregate pay cap still applies, meaning excess amounts roll over into the next year as a lump-sum payment. SES/SP award mechanics must be carefully managed to avoid overstepping these legal limits.
Watch the SES/SP Rulemaking Timeline
The 30% Level 4/5 cap for SES/SP employees becomes mandatory in FY 2026—but as of today, the regulation still forbids such quotas. If OPM’s rulemaking is delayed, enforcing a hard cap before the rule takes effect could be challenged as exceeding agency authority.
Takeaway for Federal Employees
Expect fewer top performance ratings and larger awards concentrated in a smaller group. While OPM’s memo signals a culture shift toward differentiated rewards, agencies must navigate existing legal guardrails. For now, employees should:
-
Understand their agency’s appraisal process and any negotiated procedures.
-
Document performance in terms of measurable results.
-
Watch for updates in the Federal Register on SES/SP rating rules.
Legal Disclaimer: The information provided in this article is for informational purposes only and should not be construed as legal advice. While I am a federal employment attorney, this post does not create an attorney-client relationship. Every situation is unique, and legal outcomes depend on specific facts and circumstances.
Categories
All Categories #careerprotection #doge #federalemployment #mindfulness #stressmanagement administrative cuts administrative law administrative leave administrative procedure act afge lawsuit afge v. trump agency closures agency cuts agency funding risks agency independence agency reorganization agency shutdown agency shutdowns ai and privacy ai in government ai surveillance alien enemies act americorps cuts apa appeals court trends appointments clause at-will status attorney hiring attrition vs rif awards policy awol defense bipartisan legislation black federal employees black federal workers black women in federal service blue collar federal workers box breathing budget cuts budget transparency bureau of labor statistics burnout prevention career protection career stability careerprotection cdc advisory committee cdc recall cfpb layoffs checks and balances civil rights civil rights enforcement civil rights protection civil service civil service integrity civil service protection civil service protections civil service reform civil service rights class action lawsuits class actions classified information collective bargaining competitive service rights conflict of interest congressional budget bill congressional budget cuts constitutional law constitutional rights contract obligations coping with stress court orders cpsc credibility in hearings ctap cybersecurity threats d.c. national guard data integrity deferred resignation deferred resignation program deferred resignation programs dei dei ban dei cuts dei executive order dei in government dei in stem dei policies dei research dei retaliation deia democracy protection department of education department of state dhs dhs discipline directed reassignment disability rights disaster readiness disciplinary defense discovery process discrimination discrimination law disparate impact district court injunctions dod pay freeze dod reorganization doe injunction doge doge reform doj lawsuit drp buyouts drp decisions due process due process federal employment due process rights due process violations dueprocess eeo challenges eeo complaints eeo guidance eeo laws eeo process eeo protections eeo rights eeoc eeoc claims eeoc complaints eeoc guidance elon musk emergency response policy emergencymanagement employee protections employee rights employee stress management employeeprotections employment law eo 14210 eopf audit epa epa discipline epa layoffs equal protection equity in government ethics in government executive order executive order 14251 executive order 14317 executive order challenge executive orders executive overreach executive power faca fbi reform fda oversight fed chair fed legal help fed strong community federal benefits federal benefits cuts federal budget law federal buyouts federal career defense federal career protection federal court updates federal discipline federal employee advocacy federal employee discipline federal employee ethics federal employee protection federal employee protections federal employee rights federal employee rights, federal employee support federal employees federal employment federal employment law federal employment rights federal employment stability federal employment, federal funding federal hiring freeze federal hiring reform federal job cuts federal job protection federal job rights federal job security federal job termination federal jobs federal labor rights federal law federal layoff rights federal layoffs federal pay federal pensions federal probation federal records compliance federal retirement federal rif federal wage system federal workforce federal workforce laws federal workforce protection federal workforce protections federal workforce rights federal workforce stability federal workplace federal workplace protections federal workplace rights federalemployeeresources federalemployment fehb fehb audit fehb termination fema fema cuts fers fers annuity supplement fers pension fers retirement fers supplement filing deadlines financial preparedness first amendment first amendment retaliation first amendment rights flra fmcs cuts food safety for-cause removal foreign emoluments clause fork in the road free speech furlough guidance furlough rights gao report government accountability government agencies government budget cuts government careers government downsizing government ethics. government funding, government integrity government job security government jobs government layoffs government oversight government policy changes government regulations government shutdown government transparency government waste government workforce governmentjobs governmentreform gsa workforce hatch act health benefits hhs employees hhs lawsuit hhs layoffs hhs reduction in force hhs reorg hhs rif hr letters hr modernization hr policy hr system failures hud layoffs ig firings impoundment control act independent agencies institutional knowledge interior department irs delays irs layoffs irs reduction in force irs workplace issues job loss recovery job protection job protections job reclassification job search job security job security strategies job termination judge illston ruling judge illston rulings judicial independence know your rights labor relations law day 2025 layoffs legal advice legal advocacy legal challenges legal compliance legal defense legal protection legal representation legal rights legal rights for feds legal strategy legal update legal updates legal updates for federal employees legalsupport lgbtq rights locality pay luévano consent decree mass layoffs mcmahon v. new york medical accommodation medical ethics medical privacy mental health merit hiring plan merit system merit system principles merit systems merit systems protection merit systems protection board merit-based hiring military spouses mindful federal employee mindful federal employment mindful leadership mindful workplace mindfulness mindfulness at work mindfulness at work, mindfulness for employees mindfulness in government mindfulness in the workplace mspb mspb appeal mspb appeals mspb deadlines mspb reinstatement mspb rights mspb ruling national security national security law nationwide injunctions ndas in government nepotism law nih funding nih rif ninth circuit ninth circuit stay nlrb omb omb apportionment open season opm opm contracts opm final rule opm firings opm guidance opm hiring memo opm hiring policies opm lawsuit opm memo 2025 opm policy opm policy update opm reform opm regulations opm rule opm rulemaking opm ruling opm staffing crisis opm suitability rule opm termination opm waivers osc case osc closure osc complaints osc investigation osc nomination osc nominee osc reversal osha investigations pension reform pentagon job cuts performance improvement plan performance improvement plans performance management personnel file expungement pocket rescission political appointees political appointments political discrimination posse comitatus postal service presidential authority presidential ethics privacy act privacy rights pro se representation probationary employee rights probationary employees probationary federal employees probationary federal employment probationary period probationary status probationary termination probationaryemployees prohibited personnel practices project 2025 protect federal career protecting federal career protecting federal careers public comment violations public health public sector downsizing public service public service stress management publicservice reasonable accommodation reasonable accommodations reconciliation bill reduction in force rehabilitation act religious accommodation religious discrimination religious freedom relocation rights remote law jobs remote work removal notice period reorganizing government act reporter shield rollback retaliation retaliation protection retention register retirement planning retirement processing return to office rfk jr. rif rif alternatives rif anxiety rif appeals rif cases rif defense rif guidance rif injunction rif law rif lawsuit rif lawsuits rif layoffs rif litigation rif notice rif notices rif preparation rif procedures rif resources rif rights rif strategy rif supreme court case rif supreme court decision rif suspension rif updates rifs rule of law russell vought schedule f schedule g scientific innovation scientificworkforce scotus layoffs scotus lets education department rifs move forward security clearance self-representation senate legislation separation of powers ses protections ses ratings severance pay sf 50 guide sf-50 guide shadow docket social security social security data socialsecurity ssa ssa data breach ssa layoffs state department state department layoffs state department rif state secrets doctrine stress management stress reduction student loans suitability review suitability standards supreme court supreme court decisions supreme court ruling supreme court rulings supreme court rulings, supreme court shadow docket supreme court stay taxpayer privacy telework telework policies telework policy telework protections telework rights telework rules termination title 5 protections title 5 rights title vii toxic leadership transparency trial period trump legal issues trump v. afge tsa tsa workers tsp unfair labor practice union protections union rights unionrights universal injunctions unlawful terminations usda relocation usps independence va employees va job cuts va layoffs va mission review va rif va staffing crisis va union contracts va union rights veterans affairs veterans preference veteransaffairs virtual hearings war powers resolution watchdog oversight whistleblower protection whistleblower protections whistleblower retaliation whistleblower rights work-life balance worker safety workforce downsizing workforce equity workforce reduction workforce restructuring workforce rights workplace accessibility workplace accommodations workplace culture workplace dei workplace disability rights workplace discipline workplace discrimination workplace fairness workplace justice workplace leadership workplace mindfulness workplace protections workplace resilience workplace retaliation workplace rights workplace stability workplace stress workplace stress management workplace surveillance workplace wellness workplaceprivacy workplacerights workplacewellness wrongful termination